Singapore

SINGAPORE, 15 September 2010 – Superstition against property purchases during the Hungry Ghost Festival , which began on 10th August, sent the month’s sales volume down 19% m-o-m to 1,248 units, although slightly outperforming our expectations. Developers launched a total of 1,326 units in August. Compared to past Hungry Ghost Festivals, the sales volume had a poorer showing this time round as the market was still recovering from sentiment dip in previous months.

Table1: Sales Performance during past Hungry Ghost Festivals

Year

Duration of Hungry Ghost Festival

Sales Volume

M-O-M Change

Jul

Aug

Sep

Aug

Sept

2007

13 Aug - 10 Sept

1,375

1,723

514

+25%

-70%

2008

1 Aug - 30 Aug

902

325

376

-64%

+16%

2009

20 Aug - 18 Sept

2,772

1,805

1,143

-35%

-37%

2010

10 Aug - 7 Sept

1,549

1,248

Not yet available

-19%

Not yet available

Source: Jones Lang LaSalle Research

The Core Central Region (CCR) remained the quietest despite the substantial 406 units launched by developers to stir up the market. Several major launches include: Starlight Suites (73 released units), Loft @ Nathan (60 released units), Latitude (47 released units), making up around 44% of new launches in CCR. Weaker foreign buying, being more sensitive to the recent sentiment dip, and the withdrawal of Chinese-based foreign buying, as a result of taboo against property purchases, resulted in a 44% m-o-m drop in sales volume to 155 units, translating into a take-up rate of 38%. Amongst the projects, take-up in the Loft @ Nathan was the strongest with 31 units sold given that affordable units priced below $1 million were still available compared to the rest of the projects.

Table2: Pricing of major CCR launches

Project Name

Primary Unit Type

Size (sq ft)

Median Price (psf)

Price Quantum

Take Up

Loft @ Nathan

1-bedroom

323 – 538

$1,901

$614,023 - $1 million

31 units (52%^)

Starlight Suites

1-bedroom

560 – 1,163

$2,022

$1.1 - $2.4 million

73 units (1%^)

^Refers to sold units based on released units in AugustSource: Jones Lang LaSalle Research

Sales volume in the Rest of Central (RCR) and Outside Central Region (OCR) are comparable which saw 546 and 547 units sold, respectively. Projects which saw encouraging take-up include: Centra Suites (take-up rate: 100%), Viva Vista (take-up rate: 97%) and Suites @ Topaz (take-up rate: 89%). It is noted that the median pricing of the Centra Suites ($1,201 per sq ft) has been boosted by last month’s sellout of Centra Studios, located nearby and launched by the same developer Pinnacle Realty Pte Ltd, which was sold at a median price of $1,142 per sq ft.

Table3: Pricing of selected RCR projects

Project Name

Primary Unit Type

Size (sq ft)

Median Price (psf)

Price Quantum

Centra Suites

1-bedroom

378 - 753

$1,201

$453,978 - $904,353

Viva Vista

1-bedroom

334 – 485

$1,509

$504,006 - $731,865

Suites @ Topaz

1-bedroom

614 – 738

$1,203

$738,642 - $887,814

Source: Jones Lang LaSalle Research

Where large mass projects continued to be well-received by the market, the Outside Central Region (OCR) saw the first phase of The Greenwich sold 207 units out of 266 released units (take-up rate: 78%), This alone made up 38% of the units sold in this region during the month of August. The rest of the sales volume came from subsequent launches of mass projects such as The Scala (74 units sold), Waterfront Gold (65 units sold out of 77 released units; take-up rate: 84%) and The Minton (29 units sold). Median prices are observed to be moving up marginally after the slight dip in July following the sentiment dip, in line with the larger market trend.

Table4: Pricing of selected OCR projects

Name

Primary Unit Type

Size (sq ft)

Median Price (psf)

Price Quantum

The Greenwich

1-bedroom

616 – 738

$1,095

$674,520 - $808,110

Source: Jones Lang LaSalle Research

Dr Chua Yang Liang, Head of Research South East Asia commented, “The effect of the recent government policy has not shown up in the set of numbers as it was introduced on 30th August. We can expect the September numbers to contract 30-35% m-o-m as the policy takes effect. While we maintain our previous view that full year volume to close between 13,000 and 14,000; we believe it is likely the final full year number to be closer towards the lower end of our estimate. Further adjustments to government policies, as we had expected, was made in August (alongside several other new measures in the public housing market) have resulted in resale market contracting. Although the full quarter numbers have not been released, we estimate that the resale volume (for all residential properties excluding executive condominium) in 3Q10 could decline by 20%-25% q-o-q or 25%-35% y-o-y.”

Table5: Total island-wide units (landed + non-landed) sold

Take-up Rate

CCR

OCR

RCR

Total

Total

Aug-08

109

103

113

325

168%

Aug-09

552

531

722

1,805

112%

Jul-10

278

659

612

1,549

116%

Aug-10

155

547

546

1,248

94%

M-O-M Change

(Aug 10 vs. Jul 10)

-44%

-17%

-11%

-19%

-

Y-O-Y Change

(Aug 10 vs. Aug 09)

-72%

3%

-24%

-31%

-

Source: URA/ Jones Lang LaSalle Research

Explanatory Notes:

- Core Central Region (CCR): which comprises Postal Districts 9, 10 and 11, the Downtown Core and Sentosa- Rest of Central Region (RCR): Rest of Central Region (RCR) which comprises the Central Region outside the CCR- Outside Central Region (OCR): Area outside Central Region- Landed Housing: Include bungalows, semi-detached and terrace houses- Non-Landed Housing: Include apartment/condominium- Median price: For landed residential properties (i.e. detached, semi-detached and terrace houses), the median price per sq m is computed based on their land area. For strata sub-divided properties, such as apartments, condominiums, cluster housing, townhouses, the median price per sq m is computed based on their strata floor area.- Take up rate: Number of units sold over number of units launched. Number of units sold in that month can surpassed the units launched as some buyers are buying unsold units released in the previous months.